How Are Overtime and Earned Leave Calculations Done: Basic + DA or Gross Wages?

Can somebody tell me if the earned leave encashment calculation will be done based on basic + DA or gross wages? Is it Basic + DA or Gross wages / 26 * number of PL?

Overtime Calculation

Another question I have is regarding overtime calculation. Will it be based on basic + DA or gross wages? Is it Basic DA or Gross wages / 26 / 8 * twice the working hours?

Please clear this doubt.

Thanks

As per the law, the EL (Earned Leave) is to be encashed on Basic + DA, and it's compulsory for the purpose of compliance. Now, if we talk about the EL encashment, it depends on company policy, meaning it varies from company to company. If an employer wants to pay on the gross salary, then they can, but our minimum requirement to follow proper compliance is (Basic + DA).

In organizations, most of us encash on Basic + DA only. The detail of the calculation is as follows:

Basic + DA / 26 * no. of PL

Or if on Gross, then (Gross Salary / 26) * no. of PL.

Regards,
NN

EL Calculation:
(Basic + DA / 26) * no. of PL
(10000 / 26) * 10 = 3846

Overtime Calculation:
We calculate it based on Gross Wages, to be computed on a monthly basis and paid at double the rate.
OT Calculation = ((Gross Salary / month days) / working hours) * Number of OT hours

Not as per law... It depends on employers. If an employer wants to, then he can. Most of us or everyone is paying on Basic + DA.

Regards,
NN

No, buddy, gross is not as per law. It depends on employers; if an employer wants to, then he can. Most of us or everyone is paying on Basic + DA.

Regards, NN

Attribution: https://www.citehr.com/414251-overti...#ixzz1xvt0Ig2g

Benefits Calculated on Basic + Dearness Allowance

All benefits are calculated on basic + dearness allowance:

• Gratuity
• Bonus
• Overtime
• Leave encashment

Regards,
V. Subbarao